Share story

World Wide Packets said Friday that it has received $25.5 million in venture capital and gained two new investors, one of them wireless pioneer Craig McCaw.

The interest by McCaw’s Eagle River Holdings and Kirkland-based Rally Capital, a venture firm focused on telecommunications, centers on World Wide Packets technology.

The company, based near Spokane, is building systems that help phone and cable carriers upgrade their copper-based telecommunications networks to ones that use fiber optics and Ethernet software. The upgraded systems have greater capacity and lower costs.

McCaw’s decision to fund the company may be twofold: as an investment and as a potential product for his latest venture, Kirkland-based Clearwire, which has started providing wireless broadband access in some U.S. cities.

Dave Curry, World Wide Packets’ president and chief executive, said his company’s offerings make sense for a wireless service provider.

“I do know in the conversations with … Eagle and Rally they communicated to me that they believe our technology has a role in wireless deployments, but we are just in the beginning discussions and dialogues,” Curry said.

As part of the funding, Eagle River’s Rob Mechaley will join the World Wide Packets board. Mechaley has also been Clearwire’s chief technology officer. Rally Capital Chief Executive Dennis Weibling will also join the board.

Curry said wireless providers need help transferring data from a cellphone tower back to a phone switch as wireless data traffic increases and taxes system capacity.

“People have this notion that when I’m calling across the country on a cellphone that it’s over the air,” Curry said. “Ninety-nine percent of a wireless call occurs over fixed network. Ethernet is finding its way into wireless.”

The company, which has raised $140 million to date, plans to use the funds to further develop the technology, called Carrier Ethernet, and step up sales efforts. Part of the money would be used to hire 15 people in the next six months for a total of 150 employees.

World Wide Packets, founded in 2000, survived the telecommunications crash when providers weren’t spending money on new infrastructure. Since then, the company has expanded its focus beyond its initial market — municipalities — to carriers, as these operators start laying more fiber to homes and businesses to provide voice, data and video, Curry said.

“It’s a space we think is going to grow substantially,” said Weibling, who worked closely with Mechaley in making the investment. “I think he [Mechaley] confirmed in my mind the growth potential in the industry for the product — how the growth in that particular product category is exploding.”